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DOMESTIC PARTNER COVERAGE
AB 2208 EFFECTIVE JANUARY 1, 2005

The state of California recently passed legislation that affects health and insurance coverage for domestic partners in California. AB 205 was signed into law in 2003 and effects rights guaranteed to domestic partners under law. AB 205 did not specifically address employer sponsored group health benefits for domestic partners. AB 2208, effective January 1, 2005, requires health plans and insurance carriers to extend health care coverage to registered domestic partners equal to that of spouses of an employee or subscriber.

A Domestic Partnership is defined by California law as being established when:

Both persons file a declaration of Domestic Partnership with the Secretary of State
Both persons have a common residence. It is not necessary that the legal right to possess the residence be in both of their names.
Neither person is married to someone else or is a member of another domestic partnership with someone else that has not been terminated, dissolved, or annulled.
The two persons are not related by blood in a way that would prevent them from being married to each other in California
Bother persons are at least 18 years of age
Either of the following is true: - Both persons are of the same sex, or, - The domestic partner is of the opposite sex and one or both persons are over age 62 and also meet the eligibility criteria for Medicare benefits.
Both persons are capable of consenting to the domestic partnership

Effective Dates
January 1, 2005 – All insurance policies regulated by the California Department of Insurance (except group health insurance policies) that are issued, amended, delivered or renewed on or after January 1, 2005, are required to provide domestic partner coverage.

January 2, 2005 – All group health plans and group health insurance policies that are issued, amended, delivered or renewed on or after January 2, 2005, are required to provide domestic partner coverage.

Requirements
AB 2208 prohibits health plans and insurers from offering coverage for a registered domestic partner that is not equal to the coverage provided to the spouse of an employee or subscriber. Dependents of the domestic partner will be enrolled on the same basis as dependents of a subscriber’s spouse.

AB 2208 does not apply to federal COBRA coverage or Cal COBRA extension coverage to former federal beneficiaries.

AB 2208 allows health plans and insurers to request verification of the declaration of a domestic partnership if the health plan or insurer also requests proof of marriage for married enrollees.

SUTTER SYSTEM’S LOSS

Brand loyalty is often emphasized when health care comes into question. Most say they prefer to pay more for quality care and access to their personal doctor as opposed to saving money and not having a choice. However, this does not seem to be the case in the recent decisions made by CalPERS members.

When given the opportunity to choose between less costly carriers or for an additional $30 a month, continue to have access to the Sutter system, 33,500 Sacramento locals decided it was time

to find a new carrier and doctor. For 7,800 members, brand loyalty won and for a higher monthly fee they stayed with their doctors in the Sutter system.

As a result other carriers increased their numbers significantly. Western Health Advantage increased its enrollment by 6,500 members with Kaiser picking up 3,000. The big winner was Hill’s Physicians Medical Group picking up 11,200 Sutter members.

When it came to choice, CalPERS members made a statement that cost was more important than brand loyalty and access to a particular health care system.

EMPLOYEES VOICE SATISFACTION

INDIVIDUAL UPDATE

In 2004, Watson Wyatt Worldwide, a leading human capital consulting firm, conducted a survey to measure the level of employee satisfaction with the rewards package offered by their employers. These reward packages often includes benefits, pay, incentives, profit-sharing and stock-based programs. In this study, WorkUSA®, nearly 13,000 employees were surveyed and the results were surprising. The survey showed that 61% of the workers are satisfied with their health plans while 17% were dissatisfied and the last 23% had mixed feelings. The results were the same as in 1994 and 1999 but two years ago, the percentage of satisfaction was higher, at 64%.

Ted Chien, a global director of group and health care consulting at Watson Wyatt, responded, “It appears that rising health care costs haven’t diminished the high value that workers place on the health benefit coverage they receive from their employers. This demonstrates that employers are doing a good job educating employees about the increasingly difficult burden they face in providing benefits. But employers should remain cautious. If costs continue to rise sharply and consume more of an employee’s total compensation, satisfaction could suffer.”

“Lifetime”
Life Insurance

Most of us have 10, 20 or 30 year level term life policies. Before we know it, the level premium period expires and we’re 70, what then?

Several life insurance companies have come out with Universal Life policies that extend coverage to age 120. Since there is no cash value, the premiums lower just like term premiums.

These are excellent policies to consider for those who want to leave their families a benefit after enjoying many golden years with them.

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